Thursday July 22, 8:23 pm Eastern Time
Company Press Release
SOURCE: Leap Wireless International, Inc.
FCC Clears Way for Leap Wireless International to
Rollout Cricket Concept Leap to Acquire Over 20
Million POPs
SAN DIEGO, July 22 /PRNewswire/ -- Wireless communications carrier Leap Wireless International, Inc. (Nasdaq: LWIN -
news) today announced that the Federal Communications Commission (FCC) has issued a Memorandum Opinion and Order,
which conditionally grants Leap's applications to transfer four F-Block PCS licenses from AirGate Wireless, L.L.C., in North
and South Carolina to Cricket Holdings, a wholly owned subsidiary of Leap. The Memorandum Opinion and Order also grants
Leap's application to acquire '36 C-Block PCS licenses on which the company was the successful bidder in the U.S.
government's recent reauction of PCS spectrum. The auctioned licenses will be formally granted after remaining payment
obligations have been met. The license grants affected by the Memorandum Opinion and Order are subject to certain conditions
and are effective on issuance by the FCC. Leap believes it will meet all the conditions and has initiated the required payments.
The Memorandum Opinion and Order, which has the effect of granting Leap ''Designated Entity'' status, allows Leap, or its
wholly owned subsidiary, Cricket Holdings, to acquire wireless spectrum in the C and F blocks. It therefore allows Leap to
proceed with the application for FCC consent to Leap's acquisition of certain Chase Telecommunications Holdings, Inc. assets.
Access to the C- and F-Blocks of the PCS frequency is expected to assist Leap in the rollout of its unique Cricket concept in
select markets across the United States.
''We are excited about moving ahead with our plans to revolutionize telecommunications by bringing wireless competition to
local phone service with mobility, to the people who live, work, and play in a local area,'' said Harvey P. White, chairman and
CEO for Leap. ''The unique Cricket service has already shown the need for this service and the public's overwhelming
acceptance of this advanced local loop offering. Now we can move on to other markets immediately.''
The ''conditions imposed by the Memorandum Opinion & Order include the closing of Ericsson's acquisition of Qualcomm's
infrastructure division (which has already occurred), adjusting Qualcomm's potential equity holdings in Leap, reducing the level
of reliance on its Qualcomm credit line within 18 months, removing certain Leap commitments to use cdmaOne technology in
the United States market, and altering the equipment procurement agreement between Leap and Qualcomm.
''We are confident that all conditions required will be met,'' said Sue Swenson, president of Leap and CEO for Cricket. ''The
FCC's decision will allow us to execute a strategy that makes wireless communications comfortable and predictable for
consumers.''
In October 1998 Leap filed an assignment application with the FCC to acquire four 10-MHz F Block PCS licenses in North
and South Carolina from AirGate Wireless, L.L.C. The pending acquisition will give Leap the ability to offer service in markets
including Charlotte and Greensboro-Highpoint, N.C. Those who previously opposed Leap's application have rights to appeal
the Order.
In January 1999 Leap announced its planned acquisition of substantially all of the assets of Chase Telecommunications
Holdings, Inc. (ChaseTel), the owner of a wireless service provider and eleven related 15-MHz C-Block licenses covering
potential customers in Tennessee markets including Chattanooga, Nashville, Knoxville, and Memphis. The FCC's 'order
allowing Leap ''Designated Entity'' status should facilitate the completion of this proposed acquisition. Leap's request to transfer
ChaseTel's FCC licenses is expected to be filed shortly.
About Cricket Communications, Inc.
Cricket Communications, a subsidiary of Leap Wireless International, plans to change the way people communicate by bringing
wireless communications to the U.S. mass consumer market. Called ''Comfortable Wireless(SM)'' and ''Around Town
Phone(SM),'' Cricket's new service lets customers make and receive all the calls they want within their local service area for
one low, flat rate. While roaming is not available, full mobility exists within the local area in which people live, work and play.
About Leap Wireless International, Inc.
Leap Wireless International, Inc., headquartered in San Diego, Calif., is a wireless communications carrier that deploys, owns
and operates wireless networks in domestic and international markets with strong growth potential. In conjunction with its
strategic partners, Leap has launched all-digital wireless service in the United States, Mexico, Chile and Russia, and plans to
offer service in Australia through its operating companies. Leap is dedicated to bringing the benefits of reliable, cost-effective
and high-quality voice and data services to domestic and emerging markets. For more information, please visit
www.leapwireless.com.
This news release contains certain ''forward-looking statements,'' including statements regarding the future scope of Cricket's
network. Forward-looking statements, which are based upon certain assumptions and describe future plans, strategies and
expectations of the Company, are generally identifiable by use of the words ''believe,'' ''expect,'' ''intend,'' ''plan,''
''anticipate,'' ''estimate,'' ''project'' or similar expressions. The ability of the Company to predict actual results and other future
events is inherently uncertain. Important factors which may cause actual results to differ materially from the forward-looking
statements contained herein or in other public statements by the Company are described in the section entitled ''Risk Factors''
in the Company's 1998 10-K, most recent 10-Q and other documents on file with the Securities and Exchange Commission.
Those factors most likely to cause actual results to differ include but are not limited to: uncertainties regarding Leap's ability to
access capital markets, the delayed build-out of the system in Tennessee, failure of the system to perform according to
expectations, increased competitive pressures that could affect market demand for the new Cricket service, uncertainties
relating to costs and profitability of development stage companies, and the substantial leverage of Leap Wireless and its
operating companies.
SOURCE: Leap Wireless International, Inc. |
